A technician for Ontario Excavac dumps a load from a hydroexcavation truck manufactured by Transway Systems.

Sometimes a good, long look at how your company is operating, and what you could eliminate, can lead to more business.

Barry Wood, CEO of Toronto-based hydroexcavation company Ontario Excavac, has found that out. Wood, who has a manufacturing background, got involved in lean thinking a number of years ago with the U.S.-based Association for Manufacturing Excellence.

“In a nutshell, it’s about flow and value-added removal of waste,” Wood says. “You look across your operations and you start by asking yourself: What is value in the eyes of the customer? Look across your processes, flowchart them, and evaluate where there are opportunities to eliminate nonvalue-added activity.”

Wood looked at his company using lean thinking and found several areas he could eliminate. While scary at first, the moves proved to be profitable as the company earned more business because of it.

FINDING THE WASTE

Things to eliminate by applying lean thinking include duplication of services and transportation of wastes, but it shouldn’t stop there.

“There are sources of waste that are epidemic in the construction sector,” Wood says. “Wait time for example is rampant. People are waiting for the preceding steps to be done before someone starts to work.”

Wood points to his own company as an example. While working with one of its largest customers, his crews would go out at the same time as the customer’s crews did. Ontario Excavac crews would excavate and then move aside and watch as the customer’s crews did their work. After the crew was done, Ontario Excavac crews would then start restoration work.

That was one of the first and easiest things for the customer and Ontario Excavac to change.

“Instead of us going out on a job site along with a customer’s crew, we now go to the job site the day before and do the excavation work then,” he says. “The next day, the customer’s crew comes along and does their work, and then we’ll go back after they’re done and do the restoration. There is no waiting around at the job site anymore.”

Both companies are increasing productivity just by sequencing operations that way.

“We dealt with that time waste by changing the order of steps and disconnecting a successive step from the previous one,” Wood says. “We no longer have people that are just standing around and waiting.”

Several other wastes in the construction industry can be eliminated by applying lean. Here are some Wood found in his own company:

“You can save a ton of money if you focus on applying lean practices,” Wood says. “We’re putting a big focus on eliminating waste and optimizing processes. The whole nature of moving more centrally into the city that we did a year and half ago, then putting the soil recycling facility here, it’s all about eliminating waste transportation travel time and wait time.”

APPLYING LEAN THINKING

Wood admits that when he and other company officials began applying lean thinking, what they found was a little shocking.

“When we were analyzing billings to customers, we saw that on some days as much as 40 percent of what the customer was being billed was related to traveling to the site, to the disposal site, and then back to the shop,” Wood says. “We saw that as probably the biggest initial opportunity for eliminating waste.”

By adding a hydroexcavation recycling facility in a centralized location, Ontario Excavac knocked out over 30 percent of that travel time.

“We’ve taken four hours out of a bill and put it down to like two hours for travel to and from,” Wood says. “Those are the type of savings we’re seeing. It’s substantial.”

FOR THE CUSTOMER

It was a leap of faith for Wood and his company, not knowing how their major customer would take the news of applying lean practices.

“We told them we know they pay us for every minute that we’re out from door to door, but in the long-term best interest for their business and ours, it just made sense to remove this nonvalue-added time,” Wood says.

Wood hoped that on seeing the reduction in bills, their customer would reward Ontario Excavac with more work. “That’s exactly what happened,” he says. “We just executed an extended alliance agreement with this customer. They’ve been pleased with our active efforts to contain costs.”

Wood says other company owners and managers have to trust that customers will reward them for applying lean thinking.

“I was pretty confident because we’ve worked with many customers for years,” he says. “We were definitely taking a chance to do it because you can just sit there and be fat and sassy and say they can pay for all the travel time and we’ll just keep billing them, but at some point, that was going to change. Somebody was going to change that model, and we decided it had to be us.”

MAKING IT A COMMITMENT

Any utility construction company can make the changes Ontario Excavac made — it just takes the right mindset.

“It starts with a mindset that you’re going to examine your business and eliminate waste,” Wood says. “It can be employed by service industries, manufacturing and construction. Construction is just a slow adopter. The industry is slow to adopt new practices and new ways of doing things, and lean is just one of them.

“You have to realize it’s easy to talk about, but doing it is harder than talking about it. We have our own struggles here. It’s change and a shift in culture and how we do things; and it takes time and effort and discipline and commitment to do it.”